Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5055619 | Economic Modelling | 2011 | 7 Pages |
This research provides a waste management model in the presence of macroeconomic conditions. An optimal control problem which integrates the recycling-landfilling decision with industry supply-demand dynamics is designed to achieve the value-maximizing objective. The model simultaneously considers idiosyncratic technical and aggregate demand shocks, while the stoppage time for landfill use is assumed to follow a Cox process with the intensity function of a firm's total waste collection. The closed-form solution of the optimal recycling ratio is also derived. The results suggest that when macroeconomic effects are neglected, optimal recycling ratios tend to be underestimated.
Research Highlights⺠Consider the effects of macroeconomic shocks on waste management issues. ⺠Introduce industry supply-demand dynamics into the recycling-landfilling choice. ⺠Neglecting macroeconomic effects tends to underestimate the optimal recycling ratios.